The growth of mobile virtual network operators (MVNOs) in SA is the focus of this edition of Business Day Spotlight.
Host Mudiwa Gavaza is joined by Craig Palmer, CEO of Vas-X, a mobile virtual network enabler platform, who says MVNOs hold the key to increasing competition and bridging the connectivity gap for underserved communities.
MVNOs are usually businesses not in the telecom sector. They include FNB, Standard Bank Mobile and Pick n Pay, who lease network infrastructure from mobile operators to sell data and voice services to their customers. Capitec, Old Mutual and FNB use Cell C’s network for their services.
SA’s MVNO market is expected to reach 10-million customers and has become more crowded after a requirement that mobile network operators host at least three MVNOs as part of their spectrum licence conditions from 2022.
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Globally, the MVNO market was valued at more than $78bn in 2023, and is expected to reach almost $140bn by 2030.
To compete with traditional operators, Palmer says MVNOs need a billing and customer relationship management software to handle subscribers, invoicing, and provide a 360-degree customer view, across multiple services.
Palmer also explains why he believes the likes of Lycamobile and Virgin Mobile ultimately failed in the market.
For a number of years the largest MVNO player in SA was FNB. However, Capitec Connect has now emerged as the biggest with 1.2-million customers, relegating FNB Connect to second place. FNB has about 1-million SIM cards in the market.
Palmer outlines the growth of MVNOs in SA; Vas-X’s business model; what it takes to run a successful MVNO in SA; cases of companies that have done well; and those that have failed in the market.
MVNOs constitute about 2% of total mobile subscribers in SA, though Cell C sees enough room to have as many as 10-million MVNO customers on its network alone.
Business Day Spotlight is a MultimediaLIVE Production.
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